In this dissertation, we investigate the effects of different environmental-economic policy choices on the well-being of people in the affluent North and the relatively poor South blocks of countries. We also investigate how regional cooperation or noncooperation in choosing these policies affects the well-being of people in these two blocks. Dynamic simulation (system dynamics) and optimization (dynamic games) techniques are employed for this analysis. A number of system dynamics models using STELLA software were built to do what-if type simulation analyses. The larger North-South simulation model consists of population, capital, resources, pollution, and agriculture sectors and appropriate trade and pollution transfer linkages between the two regions. A general method employing three different software packages (Stella, Maple and HiQ) was developed for the solution of the dynamic game models. This method (and the associated software code) may be easily applied to larger and more complex models than those used in this study. These dynamic game models were based on capital and resource sectors only and involved solutions of computationally intensive two-point, nonlinear, boundary value ordinary differential equations (ODEs). Also, the three types of dynamic games modeled cooperative, indifferent and coercive behavior between the two blocks. The major findings of this work are: (i) exclusive, single environmental-economic policies may turn out to be counterproductive; a combination of policies is much more useful; (ii) cooperation is much more beneficial to the North than the South, and regional indifference is the worst strategy for both--thus, side-payments may be used by the North to induce the South to cooperate; (iii) modeling of strategic relations is very important--the fact that we obtained very different dynamic game results, for the three strategic stances of cooperation, coercion and indifference, indicates that ignoring these issues may cause suboptimal results in the real world.